Free Press Staff Writer

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JERICHO — The town of Jericho, which says it was defrauded by a Vermont State Police patrol commander over several years, wants its money back from him — not state taxpayers.

Jericho Town Administrator Todd Odit said Vermont taxpayers should not have to foot the bill for any alleged fraud by former State Police Sgt. Jim Deeghan, a 22-year veteran.

Deeghan, who supervised a special extra patrol contract with the town of Jericho in recent years, is due in Vermont Superior Court today for a change of plea hearing in his criminal case. He pleaded not guilty on July 13 to two felony counts of false claims involving his two time sheets in June.

Officials have declined to comment on the specifics of any possible plea agreement that could come today. Both sides have met privately with Judge Brian Grearson in his courthouse office this month in an effort to resolve the case.

In court papers filed Friday afternoon, Vermont State Police say they can now document almost $213,000 in fraud by Deeghan, including $79,827 for his part of the Jericho contract between 2006 and July 2012. Until Friday, Jericho only had been told it was shorted $45,459 between December 2008 and July 2012.

State police suspended Deeghan on July 9 and he resigned the next day amid reports of a criminal investigation into his conduct.

Odit said any restitution order imposed by Judge Grearson should come directly from Deeghan’s assets, including his pension.

Deeghan had put his Granite Creek Road home in Colchester on the market in August for $379,500, but pulled it off after State’s Attorney T. J. Donovan filed a lien request to ensure any proceeds of a sale could go toward possible restitution.

While Vermont law does not allow for the seizure of a public employee’s pension, Deeghan, as part of any plea agreement, could reduce any potential jail sentence by agreeing to surrender his pension until full restitution was made, Vermont Law School Professor Cheryl Hanna said Sunday.

“Whenever there is a plea deal, one of the things prosecutors look at is the willingness of the defendant to make amends for past crimes and to reimburse,” Hanna told the Burlington Free Press.

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Deeghan faces up to 12 years in prison and $22,000 in fines if convicted of the two counts of false claims filed in July and two new counts of neglect of duty by a public officer filed on Friday.

Hanna, a former state prosecutor in Baltimore, said in cases like Deeghan’s she expects a prison sentence of one to two years — similar to other cases of fraud or embezzlement by public employees in recent years in Vermont.

“I would expect the sentence to be with the other cases. It’s very unlikely more than a couple of years,” Hanna said.

If Deeghan is given a prison term, one question is where would he serve the time. Often, the government tries to avoid placing convicted police officers in prisons where they might come across people they have arrested.

In Deeghan’s case, it is unclear if there are any people he has helped put in prison. Part of the allegations against Deeghan are that he never followed through on complaints and charges, including 978 traffic tickets written but never provided to the alleged violators since the year 2000. In other instances, he made up cases, investigators have said.

Hanna said it is possible that Deeghan would be placed out of state, at some low-security facility. She said most of the prisons that Vermont contracts with now are for high-security inmates. She said for white-collar crime, a less restrictive setting is often used.

Deeghan, the son of an FBI agent, can collect his state police pension in April when he turns 50. It is supposed to equal one-half of the highest two years of pay.

The state of Vermont says in fraud cases it has full power to whittle down an employee’s claimed hours of work so that a pension reflects what the employee actually worked.

“And that is all part of the restitution so he cannot continue to profit from his illegal actions,” Hanna said.

Making Jericho whole

Odit said he learned on Jan. 4 that the Deeghan case might wrap up soon and that the state was prepared to cut the town a check for the hours claimed, but never worked.

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He said the information came during a 20-minute meeting at the town offices with Col. Tom L’Esperance, the director of the Vermont State Police; Rosemary Gretkowski, the department’s legal counsel; and Capt. Glenn Hall Jr., the new troop commander for northwestern Vermont.

Kim Mercer, from the Selectboard, and Odit said they believe the money should not come from state taxpayers, including residents of Jericho.

“That has been the board’s concern,” said Odit, the town administrator. “That is our hope if there is a plea that there will be restitution and that the money will eventually come from the restitution and nobody else.”

“It would be an injustice if the taxpayers had to pay for his crime,” Mercer said Sunday.

The town is happy to accept the money from the state with the full understanding that the state is going to recover the money directly from Deeghan.

As the alleged fraud investigation began to unfold, State Police Maj. Walt Goodell, commander of the uniform division, appeared July 19 before town officials and promised the department would make the town whole.

“We’re going to make this right,” Goodell said in his opening statement at the Selectboard meeting. “We want to find every cent that you folks are owed to make sure that you are made whole in this process.”

Goodell acknowledged the department faced a credibility issue with the public.

“We are going to do whatever we need to do to restore the trust and confidence of the members of the Selectboard as well as your residents here in town, and we are going to do everything in our power to uncover every cent that is owed to you. That is our commitment to you,” Goodell said.

Under questioning, Goodell said state police were willing to have a community meeting to answer questions.

“We do recognize ... the confidence level, not only here, but statewide as a result of this situation has gone down. Our commitment is we are going to do everything we possibly can,” Goodell said.

Odit said he would estimate that he has had about a half-dozen meetings over the last six months with State Police Lt. James Whitcomb, the new station commander, or his boss, Capt. Hall, who reports to Goodell.

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No bills for Jericho

Odit also disclosed last week that after the fraud was uncovered, the Vermont State Police stopped sending bills to the town of Jericho for the extra patrols under a special contract. Odit and Mercer said once the town realized that it was not being billed, the town contacted the state police brass to get an explanation.

“We had not received a bill for a few months,” Odit said. “When I realized that, I thought maybe they are thinking about crediting us. We wanted to be billed for the services.”

Mercer and Odit said the town believed it was essential to have a full accounting of what taxpayers were receiving in the way of patrols each day. The town did not want to learn six or 12 months down the road that the state considered it even with the town, they said.

“How can they subtract when we didn’t know what we were owed? We’d rather have the money back,” Mercer said.

“The first response was they were holding them,” Odit said. After contacting Whitcomb, the local station commander, Odit said, he received a call from L’Esperance, who checked with the billing department.

L’Esperance told the Burlington Free Press last week that once he learned about the non-billing, he investigated and directed the monthly bills be sent as usual. The unsent bills also were forwarded.

L’Esperance said the state police accounting department “was trying to get their hands around this case and how the billing was going to Jericho. They are getting billed now.”

L’Esperance said he would withhold additional comment about the billing issue until at least after today when Deeghan is due in Vermont Superior Court.

Public Safety Commissioner Keith Flynn said last week that he was unaware that the state police had stopped billing Jericho after the fraud was uncovered.

State police are under contract with the town of Jericho to provide up to 20 hours of extra patrols per week at the overtime rate of any trooper signing up for the additional hours. Odit said through the end of December the town had been billed for about 300 of the possible 520 hours.

Odit noted that the state police have not been able to cover all the hours because it is filled by troopers on a volunteer basis.

Odit said he has not heard any complaints from taxpayers about the state police patrols since the fraud was uncovered. He said the troopers have focused patrols in the areas that town officials have said they want targeted because of reoccurring problems or complaints.

The Jericho Selectboard is in the process of preparing the town budget for 2012-13. Odit said the board has discussed keeping the state police patrols at 20 hours, but bumping up the Chittenden County Sheriff’s Department from 20 to 30 hours a week.